Additional Tax + NO TAX FREE THRESHOLD + HELP
I need help working out how to tax an employee who
- Pays an additional 26%
- Has a Help debt
- Has No Tax Free threshold (as this is his second job)
If I change him from No Tax Free Threshold + Help to Withholding variation of 26%, he is undertaxed.
Using advice from this forum, I created a Payroll category for the 26% additional tax.
At the end of each ATO reporting period, I add the amount of additional tax deducted and the PAYG amount together and remit both to the ATO.
This works on my end (although I have to be vigiliant to round cents to the nearest dollar in each pay and then remember to remit both amounts to the ATO!)
However, from the employee's perspective, this is less than ideal. He has to add 26 individual fortnightly deduction amounts to his PAYG when he prepares his return in the ATO portal.
Can you foresee a problem with me keeping the additional 26% payroll category (so MYOB calculates the correct tax) and then removing the amount from that field and adding it to the amount in the PAY Withholding field?
Or is there a solution to this where I don't have to manually do this (and potentially make an error)?
Hi
Well that is a problem, perhaps he could nominate an amount per fortnight ,which would make it easier for you.
However , if you have to made the calculations prior to payroll processing then you could add the additional tax to be paid by overwriting the PAYG Withholding in the pay itself
That's the only suggestion I can come up with but it would save having to use the other payroll category which I think is problematic
Hope that helps
Lisa
